Tomen Devices Corp. (2737) AI Stock Analysis

• Market Cap: ¥79.85B
• Dividend Yield: 2.41%
• Average Volume (3M): 21.98K
• Price to Earnings (P/E): 9.8
• Beta (1Y): 1.40
• Revenue Growth: 16.05%
• EPS Growth: 3.58%
• Country: JP
• Employees: 187
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 376.92
• Shares Outstanding: 6,802,000
• 10 Day Avg. Volume: 16,690
• 30 Day Avg. Volume: 21,983
• PEG Ratio: 0.04
• Price to Book (P/B): 0.77
• Price to Sales (P/S): 0.09
• P/FCF Ratio: 4.13
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: ¥12,364.00 ▼(-8.28% Downside)

The score is driven primarily by strong financial performance (growth, improving profitability, healthy leverage, and better free cash flow) and supported by reasonable valuation (P/E 11.67 and 2.67% dividend yield). This is offset by weak near-term technicals, with the stock trading below key moving averages and a low RSI indicating soft momentum.

Positive Factors

Revenue growth and improving profitability

Sustained revenue growth coupled with rising net margin signals expanding product adoption and improving unit economics. Over 2–6 months this durable trend supports reinvestment in R&D, strengthens pricing power and underpins capacity to scale while absorbing competitive pressures.

Strong free cash flow generation

Material free cash flow and solid cash conversion provide durable financial flexibility to fund capex, product development, dividends or debt reduction. Reliable cash generation reduces dependence on external financing and supports strategic investments over the medium term.

Conservative leverage and improving ROE

Low leverage combined with rising ROE indicates prudent capital structure and more efficient equity use. This structural strength enhances resilience through semiconductor cycles, enables opportunistic M&A or capex, and preserves capacity to invest without excessive financing risk.

Negative Factors

Very thin profit margins

Extremely low gross and net margins leave limited buffer against input-cost inflation, pricing pressure, or revenue volatility. Over months this structural margin thinness constrains reinvestment, limits cash available for growth initiatives, and increases vulnerability to downturns.

Low operating margins limit resilience

Sub-3% operating margins point to weak operating leverage and limited ability to scale profitably. This structural constraint means modest revenue declines or cost increases can materially depress earnings, hindering sustainable margin expansion and long-term return improvement.

Declining cash reserves require monitoring

Although FCF improved, shrinking cash reserves reduce the liquidity cushion available for capex, R&D or cyclical downturns. Over the medium term this may force external financing or delay strategic investments, weakening operational flexibility and increasing financial risk.

Tomen Devices Corp. Business Overview & Revenue Model

Company Description

Tomen Devices Corporation operates as an electronics trading company in Japan. The company sells semiconductors products and electronic components. Its products include memory semiconductors, including dynamic random access, flash, solid-state drive, and multi-chip package; system LSI semiconductors, including system on a chip and application specific intergraded circuits, display drive ICs, and CMOS image sensors; and liquid crystal displays, light emitting diodes, organic light emitting diodes, and multi-layered ceramic capacitors. The company was incorporated in 1945 and is headquartered in Tokyo, Japan.

How the Company Makes Money

The company generates revenue through multiple streams, primarily by selling its electronic components to manufacturers and distributors in various sectors. Key revenue streams include direct sales of semiconductors and sensors, as well as recurring revenue from maintenance and support services for its communication equipment. Additionally, Tomen Devices Corp. has established significant partnerships with leading technology firms, allowing it to leverage joint ventures and collaborative projects that enhance its market reach and product offerings. The continuous demand for advanced electronic solutions in emerging technologies, such as IoT and AI, further supports the company's growth and profitability.

Tomen Devices Corp. Financial Statement Overview

Summary

Strong overall fundamentals: revenue grew 13.75% (2024→2025) and profitability improved (net margin up to 1.33%). Leverage is manageable (debt-to-equity 0.28) and ROE improved to 11.26%. Cash flow strengthened with free cash flow of 9,204m yen and solid cash conversion (operating cash flow to net income 1.65), though declining cash reserves and low margins cap the score.

Income Statement

Tomen Devices Corp. shows a robust performance in the semiconductor industry, highlighted by strong revenue growth of 13.75% from 2024 to 2025 and a healthy gross profit margin of 3.48% for 2025. The net profit margin improved significantly to 1.33% in 2025, reflecting enhanced profitability. EBIT margin at 2.41% and EBITDA margin at 2.26% indicate efficient core operations, although there is room for improvement. Overall, the company demonstrates positive growth and profitability trends.

Balance Sheet

The balance sheet is solid with a debt-to-equity ratio of 0.28 in 2025, indicating manageable leverage. The equity ratio of 43.54% suggests a stable financial structure with adequate shareholder equity. ROE improved to 11.26%, showcasing effective utilization of equity to generate profit. While the balance sheet shows stability, the decreasing cash reserves need monitoring for liquidity management.

Cash Flow

Cash flow analysis shows a substantial improvement, with free cash flow growing to 9,204 million yen in 2025. The operating cash flow to net income ratio of 1.65 indicates effective cash conversion from net income. However, the free cash flow to net income ratio of 1.65 underlines efficient cash management, but the company should continue focusing on consistent cash flow generation to support operations and growth.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	421.17B	421.67B	370.68B	417.62B	462.82B	302.38B
Gross Profit	13.25B	14.70B	13.67B	16.14B	14.33B	7.86B
EBITDA	10.13B	9.51B	4.23B	8.15B	8.74B	4.69B
Net Income	5.32B	5.59B	2.10B	4.91B	6.38B	3.45B
Balance Sheet
Total Assets	158.74B	113.97B	130.21B	107.18B	116.99B	119.89B
Cash, Cash Equivalents and Short-Term Investments	6.10B	13.17B	20.86B	12.14B	8.22B	9.55B
Total Debt	48.77B	14.05B	29.66B	20.56B	9.50B	14.60B
Total Liabilities	110.76B	64.35B	84.70B	62.98B	77.63B	87.09B
Stockholders Equity	47.98B	49.62B	45.51B	43.21B	38.59B	32.17B
Cash Flow
Free Cash Flow	0.00	9.20B	4.15B	-5.25B	5.74B	-11.61B
Operating Cash Flow	0.00	9.21B	4.42B	-4.96B	5.90B	-11.58B
Investing Cash Flow	0.00	-21.00M	494.00M	-263.00M	-183.00M	-30.00M
Financing Cash Flow	0.00	-16.85B	2.90B	8.58B	-7.60B	11.30B

Tomen Devices Corp. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 13480.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:2737, the sentiment is Negative. The current price of 13480 is above the 20-day moving average (MA) of 13363.50, above the 50-day MA of 12555.00, and above the 200-day MA of 8022.27, indicating a neutral trend. The MACD of 127.09 indicates Positive momentum. The RSI at 39.87 is Neutral, neither overbought nor oversold. The STOCH value of 22.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:2737.

Tomen Devices Corp. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
7609	81 Outperform	¥53.76B	10.32	―	2.87%	10.24%	61.61%
6855	74 Outperform	¥60.60B	15.91	―	1.72%	36.31%	101.77%
2737	70 Outperform	¥79.85B	9.77	―	2.41%	16.05%	3.58%
7420	66 Neutral	¥26.94B	9.22	―	4.88%	3.32%	31.11%
7510	66 Neutral	¥36.40B	12.90	―	3.02%	7.09%	13.13%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
6625	60 Neutral	¥47.77B	456.30	―	4.32%	-44.89%	-97.21%